So, you’ve been advised that you need to appoint a deputy for a family member who is mentally incapacitated. But it’s all been a bit of a whirlwind and you didn’t take in all the information given! Our guide, prepared by Ruth Meyer, a partner at Brain Injury Group member law firm, Boyes Turner LLP, should help to guide and assist you through the process of appointing a deputy for your loved one.
What is a deputy?
A deputy is a person appointed to manage either the financial affairs or personal welfare of another person who does not have capacity to make those decisions. The incapacitated person is usually known as “P”.
Who can be a deputy?
A deputy can be anyone over the age of 18 who is not bankrupt. Usually, in cases of injury where there is a large compensation award a professional deputy, such as a solicitor, will be appointed. In such cases the cost of the deputyship is often included in the compensation claim. Trust Corporations can also be appointed to act as deputy.
How can a deputy be appointed?
A deputy is appointed through the Court of Protection and the deputyship order will set out what the deputy is permitted to do i.e. manage finances and sell or purchase property. A deputy will not be appointed if the incapacitated person (P) has already made an Enduring Power of Attorney or a Lasting Power of Attorney that covers the decisions to be made.
The deputy can be appointed to deal with either or both property and financial affairs or personal welfare. However a personal welfare deputyship is more unusual and can be difficult to obtain from the Court of Protection.
If the incapacitated person’s only income is state benefits and they do not have property or savings then it will not be necessary to appoint a deputy. In these circumstances the Department of Work and Pensions can appoint an appointee to manage the benefits of the person. This is quite a straightforward process and a much more cost effective option than an application for deputyship.
It is possible for the Court of Protection to appoint two people to act as deputies in relation to the same matter, such as two parents or one parent and a solicitor. They can be appointed jointly (which means that they must make all decisions together) or jointly and severally (which means that they can make decisions together or separately). In some situations the Court of Protection can appoint two deputies to act jointly on some matters and jointly and severally on others. There are a myriad of possibilities, although the majority of orders are for a sole deputy.
In fact, some solicitors will not take on the role of deputy if they are appointed jointly or jointly and severally as this can add extra administration. It also means that you are responsible for the decisions of others. In my capacity as professional deputy I rarely act jointly and severally but will do so if P is a resident abroad as it is much easier and practicable to act in this way.
Who is the Office of the Public Guardian (OPG)?
The OPG is the administrative arm of the Court of Protection and they maintain a panel of those willing to act as deputies for property and affairs. Panel members are appointed when there is no one suitable or willing to act as a deputy for P and they are known as a “Deputy of Last Resort”. Please bear in mind that families are able to choose who they wish to act as a deputy, as long as they have the skills and experience and are not obligated to accept a panel deputy. They will only need to consider this if there is no one else suitable.
Role and duties of a deputy
The deputyship order tells the deputy what they can and cannot do. It confers what is known as “general powers of management”. This means that they can manage all financial matters, unless there is a specific restriction.
In addition to the powers set out within the Deputyship Order, all deputies must act within the five statutory principles set out in the Mental Capacity Act 2005 which are:
- The person must be assumed to have capacity unless it is established that he lacks capacity.
- A person is not to be treated as unable to make a decision unless all practical steps to help him to do so are taken without success.
- A person is not to be treated as unable to make a decision merely because he makes an unwise decision.
- An act done or decision made, under the Mental Capacity Act 2005, for or on behalf of a person who lacks capacity must be done or made in his best interests.
- Before the act is done, or the decision is made, the deputy must consider whether the purpose for which it is needed can be as effectively achieved in a way that is less restrictive of the person’s rights and freedom of action.
The Code of Practice – Deputy duties and standards
In addition to these five basic principles a deputy should follow the Code of Practice which sets out duties and deputy standards. The Code of Practice provides guidance for anyone who works with or cares for a person who lacks capacity.
Such duties owed by a deputy include:
- Acting with due care and skill.
- Not to profit from the position i.e. you cannot be paid for the work you do unless you are a professional deputy, such as a solicitor.
- Not to delegate unless authorised to do so i.e. you cannot ask others to do the work that you are appointed to do.
- Act in good faith.
- Respect confidentiality.
- Comply with Court of Protection directions.
- Keep accounts.
- Keep their money separately from the account of the incapacitated person.
Submitting accounts for the deputyship account
Deputies are supervised by the Office of the Public Guardian which means that they are accountable to them and must submit accounts each year. They may also receive a visit from the Court of Protection visitor. The accounts should set out clearly the funds which have passed through the deputyship account in terms of income and expenditure. They should also set out all major decisions made on behalf of the incapacitated person during the year under review. Items of capital such as the value of a house or investments are also listed.
What is “The security bond”?
When a deputy for property and affairs is appointed by the Court of Protection they must take out what is known as a security bond. This is an insurance product which protects the incapacitated person from financial loss if the deputy uses their funds inappropriately. It is a highly effective form of security because if any loss is identified by the OPG and certified with the Court then it must be paid to P quickly and without dispute. There will be an annual premium for the security bond which must be paid out of P’s funds on an annual basis. The level of security is set by the Court of Protection depending on the value of the funds. Premiums have generally decreased over the last few years.
Do I need a solicitor?
As you can see an application for deputyship, as well as the annual management, can be time consuming and complicated. For deputyships which involve large or complicated assets I would recommend a professional deputy such as a solicitor. This is particularly the case if there is a sizable award of compensation that needs management. However, for straightforward matters you may decide that you do not need a solicitor or you may only need their help with the application or one off applications. Quite often I will assist lay deputies (non-professionals) with just the annual accounts.
What should I do next?
The most important point to take home is that you should choose a solicitor that you feel comfortable talking to. Ideally they would also be able to assist you on a number of other matters that may be relevant to your situation such as the completion of tax returns, the employment of carers and the investment of funds. You should also pick a solicitor who has a genuine interest in assisting people with deputyships and will ask plenty of questions so as to ensure that any decisions made on behalf of P are made totally in their best interests. It is really important to get to know P’s preferences and that can only be done by having a full detailed discussion with the person themselves, as well as their family and close carers.
Produced by Ruth Meyer, professional deputy and head of the Court of Protection Team at Boyes Turner
As well as acting as a professional deputy herself, Ruth leads the Court of Protection team at Brain Injury Group members Boyes Turner LLP in Reading. Further detail on Ruth and her Court of Protection services can be found in her Court of Protection profile in the Brain Injury Group CoP section.
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